Conterra Networks launched a five-year, multi-million dollar campaign to dig its fiber roots deeper into the soil in Texas, Louisiana and North Carolina, aiming to densify its network to serve a greater number of enterprise and carrier customers.
Founded in 2001 to serve E-Rate customers, Conterra Networks is owned by private equity firms APG and Fiera Infrastructure and offers a 100% fiber-based network for enterprise, carrier and education customers. It is primarily based in the three aforementioned states, but has fiber holdings across a total of 22 states. It currently does not have a residential business.
Michael Brady is Conterra’s EVP and chief revenue officer, having joined the company in early 2021 after serving in various leadership roles at Lumen Technologies and Level 3 Communications. He told Fierce Conterra is primarily focused on serving Tier 3 through Teir 5 cities. So, for instance, its largest market in Texas is El Paso, and in Louisiana it’s Shreveport. Conterra’s primary competitors are AT&T and cable companies Charter Communications and Altice USA.
According to Brady, Conterra is currently a $110 million company and had its best year ever in all three of its business segments in 2021. It’s looking to recreate that success in 2022 and beyond. To secure its position in the market, it’s undertaking a major expansion project and planning to run new fiber miles to reach more customers in the markets it already serves. It’s also upgrading its plant to ensure it can support the top tier wavelength services carriers are demanding.
“What you’re seeing us say is we’ve been there, we’ve built here, we’ve been servicing your community with X amount of investment and over next five years plan we plan to invest even more than we’ve invested historically,” he said. “We’re here for the future to bring high-available, high-reliable bandwidth, fiber-based bandwidth, to the communities as a whole.”
Since April, Conterra has announced plans to invest $10 million in Rowan County, $11.5 million in Carteret and Onslow counties and $34.6 million in Iredell, Catawba and Burke counties in N.C. and $10.6 million in St. Landry Parish, Louisiana over the next five years. Brady said more announcements for expansion projects and new products are on the way.
The expansion could help Conterra gain ground on competitors. According to Vertical Systems Group’s U.S. Lit Fiber Buildings Leaderboard, Conterra was listed in the Market Player tier in 2018, but moved up to the Challenger tier in 2019. It held on to its position in the Challenger tier in 2020, but in 2021 dropped back down to the Market Player tier. For 2021, the Challenger tier was for companies with between 5,000 and 14,999 lit commercial buildings, while the Market Player tier was for those with fewer than 5,000 lit buildings. The leaderboard was topped by AT&T, Verizon, Charter’s Spectrum Enterprise, Lumen Technologies and Comcast Business.
In addition to its own investments, Brady said Conterra is pursuing government grants to further its work. It has already won tens of millions of dollars, he said, and has applications for tens of millions more pending.
Brady said Conterra aggressively purchased supplies in 2020 and 2021, and so has thus far been able to weather supply chain issues fairly well. But he noted there is significant lag time for purchases of new equipment.
And in terms of pricing, he said Conterra has mostly absorbed the impact of rate increases rather than passing them to customers. While it hopes to continue to do so, it is evaluating how to handle such changes on a forward-looking basis.
While there are a lot of new fiber entrants in the market, Brady said Conterra feels confident given its established position and existing fiber assets. “They’ve got to build from zero to wherever they need to go. We don’t have that constraint,” he concluded.